King's Speech 2023: Three key takeaways for landlords and letting agents
The 2023 King's Speech has reconfirmed the government's commitment to the Renters (Reform) Bill, a new bill for leaseholders, and a focus on Net Zero.
The King or Queen opens parliament every year with a speech that outlines the government's priorities for the year ahead. This comes ahead of the Autumn Statement on 22 November, which provides an overview of the government's economic plans.
Today marked Charles III's first speech as King. Here are three top announcements letting agents and landlords should note.
- More security for renters and more reassurance for landlords in ongoing commitment to Renters (Reform) Bill
- A commitment to introduce a Leasehold Bill
- An ongoing commitment to Net Zero and energy efficiency
More security for renters and more reassurance for landlords in ongoing commitment to Renters (Reform) Bill
The speech confirmed plans to strengthen the rights of tenants in England, while providing reassurance for landlords. This is under the plans of the upcoming Renters (Reform) Bill, which went through its second reading in parliament in October 2023.
Abolishing Section 21 (also dubbed "no fault evictions") was a commitment first outlined in the Queen's Speech in 2019. It has often been seen as the headline news from the Renters (Reform) Bill.
In the first version of the bill, first published in May 2023, the government continued to push its commitment to abolishing section 21, and stated that grounds for section 8 would also be amended and strengthened to help landlords to recover their properties.
In October 2023, the government stated that the courts process would need to go through significant reform before section 21 could be abolished. This leaves timelines unclear, with the King's Speech adding no further clarity as to when or to what criteria the courts must be reformed.
A commitment to introduce a Leasehold Bill
King Charles III reasserted the government's commitment to make it cheaper and easier for homeowners to buy the leasehold of a property and to end "punitive" service charges.
Estate agents should make a note to keep an eye on future legislation regarding leasehold reforms. It is likely that these reforms will include:
- Making it much easier for leaseholders to buy the freehold of a property or to extend their leasehold
- Reducing how much leaseholders pay in ground rent, by capping costs at 0.1% of the freehold value - essentially introducing "peppercorn" ground rents
- Changes to ownership requirements for leaseholders to access these changes - such as the requirement to own a property for two years
Property Industry Eye reports that there may be a possibility that all houses will be sold as freehold in the future.
An ongoing commitment to Net Zero and energy efficiency
An additional commitment that will likely play a part in the property sector was the commitment to reach Net Zero emissions by 2035. The government wishes to "safeguard energy independence" and invest in renewable energy sources.
The cost of living crisis and war in the Ukraine caused energy bills to skyrocket over the past few years. The government has stated its commitment to help the country transition "without adding undue burdens on households."
Previously the government shared that it would require landlords to upgrade their properties to an EPC C rating by 2025 on new tenancies, and 2028 for all tenancies. However, in September 2023, Prime Minister Rishi Sunak shared that homeowners and landlords would no longer be required to meet these new energy efficiency targets by the original deadlines.
This article is intended as a guide only and does not constitute legal advice. For more information, visit gov.uk.